News

Seoul To Expand Help For Fishing & Ag Sectors

03 January 2012

SOUTH KOREA - South Korea will expand its support for the fishery and agricultural sectors to ease their losses from a massive influx of outside products under free trade agreements (FTAs), the finance ministry said.

YonhapNewsAgency states that, according to the ministry, the government will spend 24.1 trillion won (US$20.8 billion) to provide fiscal support for domestic fishing and agricultural households until 2017, up two trillion won from the previous plan unveiled in August.

Under the latest support plan, the government will ease conditions in which they can get compensation for losses caused by products imported under free trade deals.

The financial support will be available when product prices fall to less than 90 per cent of standard prices. Compensation will be offered for the discrepancy, finance ministry said.

The previous plan was designed to provide compensation when prices fell to less than 85 percent of standard prices, which are calculated by averaging market prices for three years.

In addition, tax support will be expanded for fishing and farming businesses, including provision of tax-free oil and a tax cut for the purchase of related equipment. All those tax benefits will be worth about one trillion won, up from 200 billion won unveiled in the previous plan, according to the ministry.

The government will also expand loans and counseling to companies whose sales or production are affected by the influx of imports under free trade deals, the ministry said.

The move comes as South Korea is preparing to enforce an FTA with the United States early this year. A similar free trade pact with the EU went into effect in July.

The government has unveiled diverse measures to protect industries deemed to be severely affected by cheaper foreign products under free trade deals. Experts say that farmers are among those who will be hardest-hit.

South Korea is now seeking to expand such free trade pacts with many countries in a bid to enlarge what it calls "economic territory" in the world. In particular, it is pushing for FTAs with its neighboring countries such as China and Japan.